China and the Long Road Ahead

During the Olympics, China showed the world that it can throw a heck of a coming out party. But traveling here afterward, one sees the many complexities and challenges facing this vast and ancient land.

Especially in the rural areas–where most people still live–the impressive economic rise of China has penetrated only superficially. True, the Communist Party, which still runs nearly everything, brought electricity and other development here in the early 1980s. But while some appliances like television and telephones are increasingly common, indoor plumbing, electric ovens and other comforts are still scarce.

The life of farming families is still extremely poor, filled with backbreaking labor and scavenging for wood. They don’t have tractors, so they still use water buffalo to plow, an image completely at odds with modern Beijing.

But among the most backward Chinese policies–one that deeply affects these poor rural families–is that of education. The Communist government does not provide free education at any level. Families must pay out-of-pocket tuition for primary, high school, and college education for their children.

One acquaintance I made in southwest China, a young woman in her late 20s named Ming, told me of the hardship this causes for farming families. While most can scrape together enough money to send their kids to elementary and high school, finding the $1400 annual tuition for college is usually out of sight.

Sadly, Ming, had fallen victim to this unfortunate policy.

“I wanted so badly to go to college, to continue studying English and also computers,” she said. “But my parents could not afford it. So I have to work in town to help my brother and sister, and also help my parents on the farm.”

Ming spoke with considerable frustration. “What is the future?” she asked, her face twisting in anguish. “I work hard just to help my family get by. My parents did the same when they were my age, as did their parents.” She talked of young people she knew who felt similarly trapped.

“One person he was so smart, so clever, that he felt trapped inside his head. Nowhere to go. He could not afford to live his dream. What did he do? He threw himself in the river.”

Her sadness broke my heart. Previously, she, like most Chinese I have spoken with, had talked with great pride about her country’s splashy hosting of the Olympics. “Only China can do that so magnificently,” she said.

But I wanted to ask her–or even better, ask China’s leaders: “How is it you can spend billions of dollars on your coming-out party, yet you don’t have the $1400 college tuition for your young brilliant minds?” As a result of this education policy, in China only 11 percent of its college-age people attend college, compared to 65 percent in the United States.

More perversely, unlike the United States, the economy of which is wracked by a large budget deficit, China has a huge budget surplus totaling trillions of dollars. And what do they do with this surplus? They buy tons of U.S. government bonds, essentially funding our budget deficit and subsidizing Americans so that they can keep consuming and buying Chinese goods.

From an economic standpoint, this has benefits for both nations, especially those better-off urban Chinese who benefit the most from trade with America. But it means millions of young people from farming families like Ming are going without college or higher schooling, going without their dreams fulfilled, while China plugs the holes in our budget deficit.

That’s just plain nuts. It’s a sign of not only the inequities of the global system but also of the poor priorities of China’s government. Unquestionably, the leadership in Beijing has done much to lift millions of Chinese out of poverty and to foster a growing middle class. They deserve some credit.

But it’s hard to understand why they don’t take more of that trillion dollar surplus and invest it in their people, especially in the rural areas and young people. China has become “one nation, two people”–rich vs. poor, city vs. country.

Now that its coming-out party is over, it’s time for China to demonstrate that it embraces the goal of improving the plight of its countryside, and fulfilling the hopes and dreams of young people like Ming.

A provocative, remedy-based perspective on the joint complexities of economic stability and ever expanding technology.–Kirkus Reviews

“Hill hits Silicon Valley darlings like Uber and Airbnb alongside the former online black market Silk Road, right-to-work laws, and factory robots all under the umbrella of “naked capitalism.” He explains how the rise of the “1099 workforce” is not limited to Silicon Valley; more and more traditional jobs in fields like manufacturing are turning to contractors to perform the same tasks full-time employees used to do. In addition to costing workers in benefits and safety nets, misclassifying workers as contractors costs federal and state governments billions of dollars annually in lost tax revenue.” ―Washington Monthly

“For anyone driven crazy by the faux warm and fuzzy PR of the so-called sharing economy Steven Hill’s Raw Deal: How the “Uber Economy” and Runaway Capitalism Are Screwing American Workers should be required reading… Hill is an extremely well-informed skeptic who presents a satisfyingly blistering critique of high tech’s disingenuous equating of sharing with profiteering…Hill includes two chapters listing potential solutions for the crises facing U.S. workers…Hill stresses the need for movement organizing to create a safety net strong enough to save the millions of workers currently being shafted in venture capital’s brave new world.” ―Counterpunch

“A growing underclass scrambling to make ends meet at the whim of increasingly picky and erratic employers, that number could balloon to 65 million within 10 years, or about half of the domestic workforce, warns Steven Hill in his troubling new book, Raw Deal. This brand of worker abuse cuts across industries and company size. Hill calls out Uber, AirBnb, Merck, Nissan, and dozens of others. Hill does a nice job of putting it in starker, easier-to-understand ways.” ―Washington Independent Review of Books

“Steven Hill’s book Raw Deal is a red-faced, steam-out-the-ears indictment of sharing apps. Yet Hill offers a pragmatic, almost post-ideological solution: “individual security accounts” for workers. Companies that use independent contractors, or offer scant benefits for employees, would have to add on a certain percentage of their pay as a contribution to those accounts, which would cover health care, unemployment insurance, and more. There’d be a mechanism ― and a requirement ― for companies to contribute to the long-term well-being even of workers who aren’t on their traditional payrolls.” ―Boston Globe

“Raw Deal is a book for its time. Steven Hill perfectly captures the anxiety of the American worker in today’s increasingly digital economy. Hill presents some compelling ideas, the most important being something he calls the Economic Singularity. In this unfortunate tipping point, the concentration of wealth in the hands of the few results in economic implosion because the 99 percent can’t afford to buy anything the 1 percent has to sell. The United States is turning into a nation of 1099 workers who eke out a living driving cars, renting rooms and running errands for people who apparently have better things to do with their time. Throw in self-thinking computers and obedient robots, and there won’t be any work left for plain old Homo sapiens…Hill proposes that we offer 1099 workers a new safety net consisting of tax deductions, individual security accounts and multiemployer health care plans. All good ideas.” ― San Francisco Chronicle

This book is a must read for those concerned about how technology is disrupting the way we work and eroding the social safety net, and how policy makers should respond to ensure that the growing number of workers in the “gig” economy earn adequate benefits.—Laura D’Andrea Tyson, UC-Berkeley and former Chair of the US President’s Council of Economic Advisers

“Steven Hill’s groundbreaking book on the part-time, unstable ‘Uber Economy’ shows how a new sub-economy becomes a work of law-flouting regress undermining full-time work. Remote corporate algorithms run riot!”— Ralph Nader, consumer advocate

For many years, Steven Hill’s analysis, commentary and activism have helped shape our understanding of the U.S. political economy. His latest book, Raw Deal is A riveting expose that shows with alarming lucidity what Americans stand to lose if we don’t figure out how to rein in the technological giants that are threatening the American Dream.–Katrina vanden Heuvel, editor and publisher of The Nation

In Raw Deal, Steven Hill documents in frightening detail the ways in which new forms of work promise to plunge US workers and their families into further economic hardship, risk-assumption, and instability. Fortunately, Hill does not simply anticipate catastrophe; he closes the book with an informed call for institutional reforms that would lessen the negative consequences of these potentially dangerous forms of work. Anyone concerned with US working conditions – whether American workers, worker advocates, labor market scholars, or policy-makers – must read this book .— Janet C. Gornick, Professor of Political Science and Sociology, Graduate Center, City University of New York, Director, LIS: Cross-National Data Center in Luxembourg

Praise for Expand Social Security Now

“Read this book before you vote. Few issues are more important to your personal economic future. Steven Hill shows what’s at stake, and he offers solutions that Americans of all stripes can agree on.”—Robert B. Reich, author of “Saving Capitalism: For the Many, Not the Few”

“Steven Hill has written a barn burner of a book. Or perhaps I should say ‘myth buster,’ because he systematically demolishes the false justifications for slashing Social Security. In place of misplaced animus and misleading arguments, he offers a strong case for dramatically expanding America’s most successful domestic program in an age of rising inequality and widespread financial insecurity.”—Jacob S. Hacker, coauthor of “American Amnesia: How the War on Government Led Us to Forget What Made America Prosper”, Professor, Yale University

“Steven Hill has written a vigorous defense of Social Security, the country’s most important social program. While most political debate in recent years has focused on ways to cut Social Security or privatize it, Hill goes in the opposite direction and argues for a robust expansion. Hill proposes a Social Security program that would be adequate by itself to support a middle-class retirement.”—Dean Baker, co-founder of the Center for Economic and Policy Research, and author of “Getting Back to Full Employment: A Better Bargain for Working People”

“Steven Hill has produced a dynamite handbook for angry Americans who seek to take back democracy. The true contest is not Republicans versus Democrats. It is the American people versus Washington. And this is the sleeper issue the people can win. The governing elites in both parties are trying to eviscerate Social Security—arguably the most successful and most popular program created by the federal government. Hill explains why the political insiders and their Wall Street patrons are wrong about Social Security. He shows us how to mobilize to defeat the power elites and expand Social Security rather than destroy it.”—William Greider, author of “Come Home, America: The Rise and Fall (and Redeeming Promise) of Our Country”

Praise for Europe’s Promise

Financial Times: “Steven Hill is a lucid and engaging writer. He makes you sit up and think.”

The Economist: “In a new book, Steven Hill extols the European social contract for better government services. Life in Europe is more secure, he argues, and therefore more agreeable.”

Hendrik Hertzberg, The New Yorker: “Like a reverse Alexis de Tocqueville, Steven Hill dauntlessly explores a society largely unknown to his compatriots back home.”

Andrew Moravcsik, Foreign Affairs: “Europe’s Promise is a timely and provocative book . . . the “social capitalist” policies of European countries represent best practices in handling most of the challenges modern democracies face today.”